Through the combing of hundreds of related reports in the domestic media in the past ten years, especially the cases involving private enterprises, we found some common things. There are 10 main reasons leading to the failure or death of private enterprises in China. Some of them are original and have always been accompanied by the growth history of Chinese private enterprises. It still corrodes the body of Chinese private enterprises, but some of them are new and just appeared in recent years, which is especially worthy of Chinese private entrepreneurs’ vigilance. High Quality CNC precision machine inc China Manufacturer
The first death of Private Enterprises in China: death in Shun
Everyone who drives a car knows that the wider the road, the easier it is to drive. Because the road is too flat and the field of vision is too wide, people’s spirit is easily paralyzed. Experienced designers in the design of highways, will deliberately cut straight music, deliberately design some bends. So is the person. If a person too smooth life, it is inevitable that self-righteous, arrogant. And if this person happens to be an entrepreneur, then trouble, his business is not far from accident.
As the old saying goes, “born in distress, died in peace”. We can see the shadow of “prosperity” from the failure of many private entrepreneurs. Wu Bingxin is like this, and so is Hu Zhibiao. Then Li Jiachen did Huayu, do a project into a project; Make a wood grain machine technology, earn 180,000 yuan; To make an artificial marble technology, made 6 million yuan; To make a synthetic fuel technology, in three months only entertained the local people received 3 million yuan tickets, transfer fees and 20 million yuan. So Li Jiachen thinks he can do anything, the enterprise not only want to invent. Also want to engage in real estate, but also into the pharmaceutical industry. So, a real estate lost millions of yuan, a “shoe foot fragrance” After losing tens of millions of yuan, the company lost all its savings in the following year or two.
Li Jiachen can not understand, his such a smart person, almost what to do what people, how can not do real estate, can not do the medical industry!!! Finally, he had to sell the company and lose all his savings to repay the bank loan. Later Li Jiachen went to Peking University to study, and then Li Jiachen finally came to understand that the mood was smooth. The enterprise. It is the first enemy of Chinese private enterprises and the first enemy of Chinese private entrepreneurs. High Quality CNC precision machine inc China Manufacturer
The second death of Private Enterprises in China: death
People talk about feelings, whether they are father-son feelings, mother-son feelings, brother feelings, sibling feelings, husband and wife feelings, friends feelings. No matter what kind of feelings are precious. When you start a business. When you are doing business, you often need the help of your family and friendship. But if you don’t handle it well, it will become a burden for you to do business. “there are only eternal interests in the world. There are no friends forever. “it sounds cold, but it’s the truth most of the time. People who do business should always keep in mind.”
The third death of Chinese Private Enterprises: the death of Enterprise politicization
China is a country that stresses politics, but the politics we are talking about here is not the politics of the prevailing concept or the doctrine. The so-called politicization of enterprises is the significance of a business carrying politics. Bearing the political future of officials, often the result is the rapid death of the enterprise. Officials must first have political achievements. The easiest to make achievements, let people see where the achievements are? Road building, floor building, so, along with the official performance and official promotion, in these two places the largest number of enterprises.
There are too many things like this because of the great success of the officials, and there are still some entrepreneurs who are opportunistic and bent on “politics” and rush to give others “achievements.” The enterprise is the enterprise, the entrepreneur’s destiny is to make a profit, not to engage in “politics”.
Death of Chinese Private Enterprises in 4th: psychological imbalance
Business people want to maintain a good mentality, because the mind determines action. Wrong attitude, action is easy to mistake, the ultimate destruction of people, but entrepreneurs to maintain a good attitude is not easy. Especially when it comes to the pattern of interests and the distribution of interests.
Death of Chinese Private Enterprises in 5th
Shi Yuzhu later summed up his experience, saying that his biggest mistake is that he did not understand finance and lost control of risk. Wu Bingxin once said to Shi Yuzhu, “who can get all the gold in the world?” One has to learn to control one’s greed. Entrepreneurs may not be entirely motivated by greed, but risk control, especially financial risk control. It should be the basic skill of an entrepreneur. It is a pity that the enterprise dies because of its venture, and often dies at its most glorious time.
6th deaths of private enterprises in China: death out of the rules of the game
Market economy is credit economy, everyone must abide by the rules of the game and act within the rules of the game. China’s market economy is just a developing market economy, in such a transitional period, credit. It’s especially important to follow the rules of the game. Some entrepreneurs see the rules as a play, doing what they want and doing what they like, just for a moment, regardless of the feelings of others. Finally, the market incurs revenge, and suffer the consequences of its own.
China’s private enterprises die in 7th: death of brokers
Brokers are the kind of people who live on their lips. They are characterized by being lighter than promises, but seldom seen to live up to their promises. They are like Su Qin and Zhang Yi in the warring States period, carrying a mouth all day long on Zhou You’s shoulders. But not like Su Qin, Zhang Yi, like the United States, helping others to achieve a career. They can only destroy people, can not become? They can only give bad things to others, but they can never help them. But in this age of “capital operation”, these people are very popular, and they are becoming more and more popular.
If you meet someone with a good tongue tomorrow, tell you how he can easily turn your $100,000 into $1 million, $10 million, and $100 million. You mustn’t believe it. Eight out of ten is a broker! And ten out of ten, 8 / 9, were never moral, and the common people’s words, “be fooled, can be deceived”, that is, this kind of person.
Death of Chinese Private Enterprises in 8th: death in Media
For enterprises, the media is a two-edged knife, the use of good, can greatly help the development of enterprises; Not only is it not helpful to the enterprise, but it will hurt itself. In a word, what the media need in the process of marketization is conscience; Entrepreneurs, in their dealings with the media, need wisdom.
Ten other “dead laws” of private enterprises
In the past twenty years of reform and opening up, private enterprises have been rising, developing and growing. They have become an indispensable part of the national economy. Nevertheless, in the fierce market competition, many private enterprises are quickly eliminated and disappeared.
Companies like people, if not care, let its exposed to wind and rain is ultimately to get sick, sick. And the lack of effective treatment, will soon be regarded as hopeless..
The first death method of an enterprise is death.
These companies are either congenitally deficient, the internal mechanism is not perfect; either the mechanism of aging, follow the prescribed order, such as “hard” promotion according to status, honor, praise or criticism against unfair interests; either the top, rather do Zito, not the tail, the opponent was an easy job to do all broken up. The whole body is due to produce the disease has not been timely and effective treatment, long illness and end, is death.
The market economy is about the survival of the fittest, in the fierce competition in the market, often before the closure, after the pursuers, enterprises can not squeeze, the market share of smaller, less talent farther, efficiency is getting worse.
The second dead law of an enterprise is “squeezed out”.
Because of the great disparity in strength and the double squeezing of state capital and foreign capital, it compels you to withdraw from a certain industry and be “crushed to death”.
The third dead law of an enterprise is dragged to death.
Some enterprises in the development process has formed a certain scale, due to various reasons, the company has failed to establish a modern enterprise system, poor management, leading to rising costs; the unfair distribution, leading to low morale; no enterprise innovation ability, resulting in product backlog; occupation managers play process, lead to the loss of corporate assets.
Here, I’ll tell you a story: one of my friends to do a piano, and hired two occupation managers to take care of business, though they have no shares, but they can service consumption, they together to discuss what results? The piano make money, the boss is naturally happy, but we have no the dividend, does not increase the operating costs when? So I decided to buy a motorcycle, buy a mobile phone, also install the phone at home, and a lot of on-the-job consumption. Money is earned, blink and no bonus may disappear without a trace, the boss, the enterprise can do it?
Fourth kinds of dead method called death.
The main reason is the wrong decision, when a company for the project decision, made some common mistakes, this is called his death. For example, projects and personnel structure of their chosen does not match, do not match with the strength of their own, do not match with their own ability, and their culture does not match especially, make some have made mistakes, make some stupid sense error. No one wants you to do so, who did not order you to do this project, I think this is a mistake, not only cannot judge the project on their own also can not judge, think what you can do, this is called death.
5th methods of death are called being crushed to death.
In private enterprises there are many such phenomena, blindly expand, greedy for large, do not pay attention to infrastructure, do not practice internal work, internal management chaos, although self-aware of the low efficiency, but dare to go to a large loan. I am not even afraid of high interest loans, claiming that profits are equal to reducing interest on loans. I found a huge amount of debt, and I was overwhelmed by the pressure. I don’t know whether the loan will be repaid with interest at all, and finally. The enterprise is found by their own huge debts alive and alive.
Enterprise 6th kinds of death method is called suffocate death.
In the business process, you may focus on asset quality, may also focus on inventory, you may also focus on many other aspects, but often ignore the cash flow, like go, go is two breath alive. One breath death, cash flow status is another breath of sustainable development of the business, although you still have assets, and inventory, once the cash flow is interrupted. At the end of the day you have to declare bankruptcy. It’s called a business being choked alive.
The 7th methods of death in an enterprise are called sudden death.
Because the enterprise relies on the personal ability excessively, the resources available for use are often highly concentrated. Once the judgment of the individual deviates, or the individual has an accident, it will inevitably make the enterprise highly ineffective and suffer heavy damage. The result is a sudden death of an enterprise, which is called a sudden death of an enterprise. This is the result of putting all the eggs in one basket. High Quality CNC precision machine inc China Manufacturer
The 8th methods of death in an enterprise are called unjust death.
This is divided into two situations, one is subject to policy adjustment, resulting in the enterprise can not do, because your industry policy is too strong, once the national policy is not conducive to the adjustment of the enterprise. The consequence is the death of the business.
Here I cite a case: there is a private enterprise want to participate in credit cooperatives, this is originally a good project, but just entered, on the policy adjustment, the local government credit cooperatives received, converted into commercial banks. For years, without dividends, no interest, no return on equity, no mortgage on equity, then you’re dead.
There is also the fact that the relationship between the government and the enterprises is too close. Some private enterprises have started their businesses by soliciting certain government officials to do grey transactions. It is not because they are incapable of their ability, nor are they the projects they want to carry out. It is because some of the government officials are too close and engaged in black transactions, because of complex personnel disputes, the result is a political struggle. There are still many cases in this respect.
The 9th ways to die in an enterprise are called “old age.”
There are many enterprises, because the quality of their families is not high, the vision is short, the small rich are safe, lack of lofty goals and long-term vision, can not adjust the industrial structure and talent structure in time with the changes of the market. Well, the life span of this kind of enterprise is certainly not long. But it has a characteristic, it is slowly dying out. Although its age is not big, it has already begun to grow old, which is called old death.
The company’s 10th ways of dying are stabbed to death.
This is because the enterprise management is not standardized, everywhere illegal, many faults, give people a handle. As a result, the defendant fell on three charges and two indictments. Even if such enterprises have lofty goals and ambitions, because of their own irregularity, they can only “die before they get paid.”